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The Project is designed to increase the trunk pipeline capacity

Russian First Phase Expansion Facilities Put into Operation

A Meeting of the Board of Directors of Caspian Pipeline Consortium-R and Extraordinary General Shareholders Meeting of Caspian Pipeline Consortium-K were held in Astrakhan on April 23.
The meeting attendees listened to a report on the status of the Company business, health, safety and environment protection. Per the report, CPC worked 18 million manhours without incidents and injuries. This figure is of special importance, taking into account that more than 5,000 persons work currently at the Consortium’s twenty locations, and this figure has improved year to year.
The meeting participants discussed the progress of construction work done to increase the pipeline system capacity. It was resolved to approve a comprehensive schedule of commissioning the expansion facilities within the approved budget at the Annual Shareholders Meeting to be held in Geneva at the end of May. Kazakhstan First Phase Expansion Facilities will be put into operation in December this year. It is planned to complete all work under the Expansion Project by the end of 2015.
The meetings concluded with a ceremony of putting the Consortium’s upgraded Pump Stations (Astrakhan PS, Komsomolskaya PS and Kropotkin PS) into operation and completion of the Expansion First Phase in Russian. In the course of a live teleconference, the heads of the said Pump Stations reported to the CPC Head, Astrakhan Oblast Governor Zhilkin and CPC Shareholders on the construction completion and success of the tests run. The Consortium’s Chief Dispatcher confirmed readiness of the system for starting up, following which the ceremony participants headed by Nikolay Brunich and Alexander Zhilkin pressed a symbolic start button.
Commenting the event, Nikolay Brunich noted: «The Astrakhan area sees now putting into operation of Astrakhan PS. Two more stations will be put into operation in the near future, which means creation of new jobs for the local communities and additional payments to the regional budget». In his turn, A. Zhilkin said that the regional government will provide all necessary conditions for the Consortium’s work and will assist with prompt resolution of any related issues.
Upon completion of the main event program, Shareholders visited the PS construction site located in Krasnoyarsky District of Astrakhan Oblast (A-PS -4A), the PS to be put into operation in the first quarter of 2015, and reviewed the work progress under the Second Phase of the Expansion Project.
CPC pipeline system is one of the largest investment projects in the energy industry with participation of foreign capital on the CIS territory. The length of the pipeline connecting the oil fields in Western Kazakhstan with the Marine Terminal near Novorossiysk is 1,511 km. CPC Marine Terminal is equipped with single point moorings which allow for safe tanker lifting at a considerable distance from the shore, also when the weather conditions are unfavorable.
The Expansion Project includes rehabilitation of 5 existing and construction of 10 additional pump stations (2 in the Republic of Kazakhstan and 8 in the Russian Federation), six new storage tanks (100,000 each) in addition to the existing four near Novorossiysk and a third SPM at the CPC Marine Terminal, and also the replacement of an 88 km pipeline section in Kazakhstan with a larger diameter pipe. The total amount of the Project investments will be US$ 5.4 billion.
CPC Shareholders: Russian Federation (represented by Transneft – 24% and CPC Company – 7 %) – 31%; Republic of Kazakhstan (represented by KazMunayGaz  – 19% and Kazakhstan Pipeline Ventures LLC – 1.75%) – 20.75%; Chevron Caspian Pipeline Consortium Company - 15%, LUKARCO B.V. – 12.5%, Mobil Caspian Pipeline Company – 7.5%, Rosneft-Shell Caspian Ventures Limited – 7.5%, BG Overseas Holding Limited - 2%, Eni International N.A. N.V. - 2% и Oryx Caspian Pipeline LLC – 1.75%